Palestinian militant group Hamas has agreed to a 24-hour humanitarian truce in their conflict with Israel in the Gaza Strip, a spokesman for the group said, hours after an initial 12-hour break in hostilities ended.

"In response to UN intervention and considering the situation of our people and the occasion of Eid, it has been agreed among resistance factions to endorse a 24-hour humanitarian calm starting from 2pm on Sunday," Sami Abu Zuhri told Reuters news agency.

Israel had earlier called off its own 24-hour truce after Hamas fired a volley of rockets into southern and central Israel.

Three hours after Hamas proposed a new truce, Israeli prime minister Benjamin Netanyahu said Hamas had violated its own offer.

Asked whether Israel would accept the truce, Mr Netanyahu told CNN: "Hamas doesn't even accept its own ceasefire, it's continuing to fire at us as we speak."

He added that Israel "will take whatever action is necessary to protect our people".

Israel and the Hamas Islamists who control Gaza agreed to a 12-hour ceasefire on Saturday to allow Palestinians to stock up on vital supplies and retrieve bodies trapped under the rubble.

Mr Netanyahu's cabinet extended the initial quiet until midnight on Sunday, on the condition that Israeli forces could continue to track down and destroy militant tunnels that criss-cross the Gaza border.

Hamas rejected the proposal and said its forces would keep fighting as long as Israeli troops remained in Gaza.

After what we saw this morning, it is clear we need to resume fighting with even greater force.

Israeli communications minister Gilad Erdan

Palestinian witnesses reported heavy shelling east of Gaza City with ambulances immediately racing towards the area. At least three deaths were reported in separate strikes.

At least 1,050 Gazans, mostly civilians, have been killed in the 20 days of fighting.

An Israeli soldier was also killed overnight by cross-border mortar fire bringing the army death toll to 43 soldiers, with three civilians killed in Israel by rockets fired from Gaza.

"Following Hamas' incessant rocket fire throughout the humanitarian window, which was agreed upon for the welfare of the civilian population in Gaza, the [army] will now resume its aerial, naval and ground activity in the Gaza Strip," a military statement said.

Hamas said it had fired at the Israeli cities of Tel Aviv and Ashdod. No damage or injuries were reported.

Mr Netanyahu was due to convene his cabinet to decide how to move forward - one senior minister said Israel must step up its offensive.

"After what we saw this morning, it is clear we need to resume fighting with even greater force," communications minister Gilad Erdan told Army Radio.

Israel launched its Gaza offensive on July 8 to halt rocket attacks by Hamas and its allies, which have struggled under an Israeli-Egyptian economic blockade on Gaza and were angered by a crackdown on their supporters in the nearby occupied West Bank.

After aerial and naval bombardment failed to quell the outgunned guerrillas, Israel poured ground forces into the Gaza Strip 10 days later, looking to knock out Hamas's rocket stores and destroy the vast network of tunnels.

Diplomatic efforts stall as truce fails to resolve crisis

Meanwhile, there has been little progress on international diplomatic efforts to secure an end to the conflict.

US secretary of state John Kerry flew back to Washington overnight after meeting in Paris with the foreign ministers of France, Italy, Britain, Germany, Turkey and Qatar.

Meanwhile, demonstrators in London marched from the Israeli embassy to the House of Parliament in Whitehall to protest the Israeli incursion.

French police clashed with pro-Palestinian protesters defying a ban by authorities to march in central Paris.

The positions of both Israel and Hamas regarding a long-lasting halt to hostilities appear as far apart as ever.

Hamas wants an end to the blockade of Gaza before agreeing to halt hostilities. Israeli officials said any ceasefire must allow the military to carry on hunting down the Hamas tunnels.

Some of the tunnels reach into Israeli territory and have been used to carry out surprise attacks on Israelis. Other underground passages serve as weapons caches and Hamas bunkers.

Israel says its forces have uncovered more than 30 tunnels, with four shafts discovered on Saturday alone.

During the lull in fighting inside Gaza on Saturday, residents flooded into the streets to discover scenes of massive destruction in some areas, including Beit Hanoun in the north and Shejaia in the east.

Israel hopes the images of widespread desolation will persuade Gazans to put pressure on Hamas to stop the fighting for fear of yet more devastation.